Dubai gold rate is under pressure - UAE shoppers get discounts, cashback offers

Dubai: Were you planning to buy gold but finding current prices too high? Then, help is on the way as UAE gold and jewellery retailers launch discounts and cash offers to offer whatever possible savings for shoppers wanting to buy now. And next week onwards, there will also be the additional support from the Dubai Summer Surprises’ promotions on gold purchases.

There could be another bonus on the way for UAE shoppers – gold prices are coming under pressure in the global market and this will obviously be reflected in the Dubai gold rate. Currently, the local price for a gram of 22K is Dh376, which is not much of a change from the Dh378.5 24 hours earlier.

If with the Summer special offers, shoppers can get savings of Dh2-Dh5 a gram, then that makes for a decent deal under the circumstances. Now, it's up to the shoppers to be convinced - and UAE gold retailers are giving them every chance to find out.

But in the last few hours, bullion prices have seen a sharp drop by more than $40 to $3,349 an ounce. If this trend continues through the day, the Dubai gold rate could close this evening trimming a further Dh1-Dh2 per gram.

“Right now, anything around Dh380 is a ‘no-go zone’ for gold shoppers,” said a jewellery retailer. “That’s been the sentiment we are seeing at the Dubai Gold Souq in recent days, and the visitor numbers have dropped drastically.

“But if shoppers are convinced about the new discounts and cashback offers, then there is a good chance they will return. And the biggest bonus will be if today’s early trends of more price drops continue.”

Until a week ago, just about everyone in the local gold industry was talking about the local gold rate for 22K surging towards the Dh400 a gram mark. Right now, they are not so sure. There was a recent Citi report that specifically talked about gold falling over 20% over the next 12 months to around $2,800 an ounce levels.

That's been an eye-opener for many in the industry, because no one had been hearing an alternate opinion to 'gold will keep going up'.

The change in thinking will soon filter down to shoppers too. Which is all the more reason why the new round of summer discounts and other offers are so important.